There were a lot of problems the last time Jack Dorsey was CEO of Twitter

Evan Williams and Jack
Dorsey had drama the last time around.Wikimedia Commons

Jack Dorsey, Twitter's new interim CEO, has been CEO of the
company before.

The last time around, he got pushed out and he later said that
felt like a "punch in the stomach." It's been nearly a decade
since Dorsey's ousting at Twitter, but here's what happened back
then.

Dorsey was the person who actually came up with the idea for a
micro-blogging site like Twitter. He sketched it out on a piece
of paper in the early 2000s, called it Stat.us, then shelved it
to pursue a career as an engineer.

He joined Evan William and Biz Stone's podcasting startup Odeo,
but when it began to go sideways, the startup looked for other
ideas to pivot into. Dorsey and another engineer named Noah Glass
(who was
later pushed out of the company) presented the idea for
Twitter and began working on it with Williams' blessing.

When Twitter finally spun out of Odeo in 2007, Dorsey was named
CEO. He was only 30 years old then.

But under Dorsey, Twitter wasn't the most stable place. It gained
significant traction but both the product and the team began to
crumble.

"Jack is crazy-smart and a product visionary and all that," one
person familiar with Jack's early work there told
Business Insider in 2013. "But Jack wasn't ready to be CEO at
that time."

Twitter's total downtime
in 2007 totaled more than 5 days.Royal
Pingdom

Dorsey struggled with the transition from engineer to boss.
He wasn't leading teams well, and employees weren't happy
working for him. He wasn't hiring new people fast enough.

The site constantly crashed, making the Twitter "fail
whale," which appeared when the site went down, a more prominent
mascot than Twitter's blue birds. In 2007, the year Dorsey became
CEO, Twitter's total downtime was six days. The constant crashing
was a source of stress.

"Jack's role was that of a founder and a heavy influencer at the
board level," said the person who worked there. "But he is not
operational...he's not broadly effective."

"Jack is very smart, but he is not a leader," said another. "He
can inspire investors more than employees."

Dorsey's interest in and facility with the financial side of the
business left much to be desired. Dorsey,
according to Nick Bilton's book Hatching
Twitter, made mathematical errors while keeping track of
Twitter's expenses. He set up partnerships with texting companies
but SMS fees were so high, Twitter was spending nearly 6-figures
per month.

Dorsey had also not yet focused entirely on Twitter: He wanted to
be a fashion designer, and he'd often leave work to take night
classes. He also left early for art and yoga classes. His
extracurriculars eventually became such a distraction, Bilton
reported, that Williams eventually sat down with Dorsey and said,
"You can either be a dressmaker or the CEO of Twitter. But you
can't be both."

You can either be a dressmaker or the CEO of Twitter. But you
can't be both.

Sometime during 2008, Odeo founder and financial backer Evan
Williams got fed up. He decided that he should be — and
would be — the CEO of Twitter.

Williams had more money than Dorsey and three or four times as
much Twitter stock. As Twitter's majority shareholder, when
Williams made a decision, it was final. The Twitter board agreed
that Dorsey wasn't working out, and they backed the decision
to remove Dorsey.

When Williams came after Dorsey's position in the fall of 2008,
it was an ugly "violent exchange," a source told Business
Insider.

"Jack wanted to be CEO, but it wasn't really the right call,"
this person said. "It was very clear Ev wanted to be CEO and it
was pretty clear to people in the company that Ev was a better
choice."

Unlike Dorsey, Williams was a proven entrepreneur. "Ev had
more credibility than Jack," says the source. "He wanted the job.
He got the job. That's why their relationship is a little
touchy...He made it happen."

Publicly, Williams lay Dorsey's firing at the board's feet. And,
ultimately, the board may have done the dirty work. Two of its
members, Bijan Sabet and Fred Wilson, took Dorsey out to
breakfast and delivered the blow, Bilton
reports. They told Dorsey he'd receive $200,000 severance and
become a silent chairman; Williams would be Twitter's new CEO.

On October 16 2008, the news was made public. "While the
board of directors and the company have nothing but praise for
where Jack has taken us, we also agree that the best way forward
is for Jack to step into the role Chairman, and for me to become
CEO," Williams
wrote then.

Dorsey knew who had sacked him. For the next four years, Dorsey
and Williams barely talked. Dorsey nearly joined Twitter's
greatest competitor, Facebook, out of spite. Dorsey later told
Vanity Fair's David Kirkpatrick his ousting felt like "being
punched in the stomach."

Dorsey learned a common startup lesson the hard way: Coming up
with an idea doesn't mean you own the business.

"I let myself be in a weird position because it always felt like
[Evan Williams’s] company," Dorsey later said. "He funded it. He
was the chairman. And I was this new guy who was a programmer,
who had a good idea. I would not be strong in my convictions,
basically, because he was the older, wiser one.”

One year later, in 2009, Dorsey founded another company, Square,
with a new group of investors. It was a startup no one would be
able to rip away from him, and it's grown to become a
multi-billion-dollar company.